Last week's flows were choppy due to the Federal Reserve meeting and the prior Friday's employment report. Most investors were sidelined, though servicers were actively selling and there was some profit taking by banks. In addition, there was selling from originators totaling slightly more than $1 billion per day on average, mostly in 5.5s and 6s. Over the week, spreads versus Treasurys on 30-year Fannie Mae 4.5s through 6.5s averaged 10 basis points wider. In 15s, spreads were 16 basis points weaker in 4s, plus 11 basis points in 4.5s, while 5s and 5.5s were seven and three basis points cheaper, respectively.

A rough period ahead for mortgages?

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